Southmark Corp

Southmark Settles Battles: Southmark Corp., once an $8-billion real estate conglomerate built through junk bonds, moved to sever ties with former officers it blamed in part for its failure. Southmark accepted $13.2 million to settle all lawsuits between the liquidating company and the two men. In exchange, Southmark will give up its interest in a company controlled by Gene E. Phillips and William S. Friedman. The company will also give up 15 real estate properties and six mortgages.

The well-known loans between Lincoln Savings & Loan and Southmark Corp. have often been interpreted as little more than improper transactions used by thrift owner Charles H. Keating Jr. to get around federal regulations. But a ruling this week by a federal judge in Tucson would seem to take some of the wind out of such opinions. U.S. District Judge Richard M. Bilby on Monday awarded $49.

Southmark Settles Battles: Southmark Corp., once an $8-billion real estate conglomerate built through junk bonds, moved to sever ties with former officers it blamed in part for its failure. Southmark accepted $13.2 million to settle all lawsuits between the liquidating company and the two men. In exchange, Southmark will give up its interest in a company controlled by Gene E. Phillips and William S. Friedman. The company will also give up 15 real estate properties and six mortgages.

Southmark Corp., a large, diversified financial services and real estate company, said it has filed for protection from creditors under Chapter 11 of the federal bankruptcy code. The move was expected after Southmark reported May 16 that it lost $1.04 billion in the third quarter ended March 31, which placed it in violation of net worth agreements on some of its publicly traded bonds.

In one of the largest verdicts by a California jury, a Rancho Santa Fe couple has been awarded $130.9 million in damages from Southmark Corp., a Dallas-based real estate investment and financial services company. The couple, John and Lynne Riddle, had sued Southmark in San Diego County Superior Court in 1984, alleging fraud, breach of contract, intentional infliction of emotional distress and interference with business relationships.

Southmark Corp.: The real estate and financial services company reported a third-quarter loss of $1.04 billion, largely as a result of adding more than $800 million to its provisions for losses, the Dallas-based firm said. The results, stemming partly from discontinued operations and extraordinary items, compared to a $12.3-million loss a year earlier. Revenue for the period ended March 31 slipped to $406 million, compared to $431 million a year ago. The company said its deteriorating financial condition and a continuing depression in many real estate markets required significant adjustments in its provision for losses.

Southmark Corp. has filed a $200-million suit contending that former junk bond king Michael Milken and others at Drexel Burnham Lambert Inc. are responsible for the real estate development company's demise. The suit, filed in U.S. District Court, said Milken and others "saddled Southmark with a crushing burden of public debt, then encouraged Southmark to divert the proceeds of that debt from legitimate operating needs to highly speculative investments."

The J.M. Peters Co. may be a favorite of high-end home buyers in Orange County, but it appears to rank way down the list of industry analysts Barbara Allen and Alan Goldman. In a recent report, Allen and Goldman savaged Peters' majority owner, financially ailing San Jacinto Savings Assn. in Houston, for refusing to divulge information about the future of the publicly traded Newport Beach home builder. The Kidder, Peabody & Co. analysts weren't all that nice to company president and namesake J.M.

Home builder J.M. Peters Co. Inc. reported sharply lower earnings Friday for its third quarter as the market for new homes in Southern California slowed down. Meanwhile, a local stock analyst said a sale of the Newport Beach company could come as soon as the end of the year. Peters said earnings dropped to $5.7 million for the quarter ending Nov. 30, compared to $8.5 million last year.

Speaking of Daum-Johnstown, its troubled parent--Dallas real estate investor Southmark Corp.--is in the news again. The company still owes a whopping $2 billion after going on a spending spree in recent years. Many company watchers suspect that Southmark may soon start selling some of its jewels, like J.M. Peters Co. Inc.--the immensely profitable Newport Beach home builder of which Southmark is majority owner--and perhaps even less stellar performers such as Los Angeles-based Daum-Johnstown.

A troubled Texas thrift says it is considering selling its stake in J. M. Peters Co. Inc. of Newport Beach, one of Southern California's largest home builders. A sale has long been expected, as San Jacinto Savings & Loan Assn. of Houston has been ailing for some time; the thrift reported a loss of $100 million for the fiscal year that ended in June. San Jacinto said late last week that it had hired the investment banking firm of Shearson Lehman Hutton Inc.